I just learned recently that the FTC has given a thumbs up to the Social Intelligence Corp. archiving seven years worth of people’s Facebook posts, posts that can then be used as part of their background checking service for job applicants. With that in mind, I’d just like to tell whatever computer algorithms are currently crawling over and compiling my profile to sell to potential future employers that all my status updates about fake calling in sick to work, family health concerns, having too much fun at a party or disgruntlement with bosses were all j/k lol.
I read that at the same time I just read the latest Demos report by Amy Traub and Shawn Fremsted, Discrediting America, The Urgent Need To Reform The Nation’s Credit Reporting Industry. A fantastic report on something I’ve been wanting to think through and start to conceptualize a reform agenda: the credit reporting scores play a huge role in society but they have huge oversight gaps and major, systemic errors that bias against consumers. What do these errors look like? From the report:
A 2008 Federal Trade Commission (FTC)-sponsored pilot study found that about 31 percent of people who reviewed their credit report found errors that they wanted to dispute. About 11 percent of people reported errors that were categorized by the FTC as “material”, i.e. errors that significantly affected credit scores…A 2011 study funded by the credit reporting industry and conducted by the Policy & Economic Research Council (PERC) was larger and more representative, finding that 19.2 percent of people who reviewed their credit reports identified information that appeared to be erroneous. 12.1 percent reported apparent errors that could have a material impact—mistakes that go beyond a misspelled name or incorrect address…
How do errors in credit reports affect borrowers? A 2004 study by researchers at the Federal Reserve analyzed 300,000 credit reports, cataloguing the types and frequency of various categories of negative information on the reports [see above graph].
Beyond that, the report identifies a “mission creep,” where now 60% of employers are using credit reports regardless of the fact that no studies have shown any correlation between scores and job performance. You can read this editorial by Amy Traub at The American Prospect to get a sense of what this looks like, both the endless spiral where bad credit can’t be broken without a job, and can’t get a job with bad credit, as well as the subtle humiliations that come from a hiring scheme like this:
After two years of working in a temporary job as customer-service representative, Debra Banks was offered the job permanently. She was sent a hire letter, set a start date, and confirmed her new salary. But there was a hitch: To get the job, Banks had to undergo a credit check…But when the credit report came back showing unpaid bills from a recent hospitalization, the company rescinded the offer.
Demos offers suggestions for how to fix these problems, which can be driven through the CFPB and are also being fought at the state level. Check it out.
I’d note three things in addition to what Demos finds.
1. We’ve been trying to move away from the Rawlsian fairness brigade this year towards a more Walzerian Spheres of Justice approach, where justice calls for multiple spheres of inequality to keep each other in check. For our purposes here, I’m interested in the notion that nobody should be precluded a social good y because on their lack of possession of an unrelated good x. That the sloppiness of credit scores, the protection of bankruptcy against bad debts, the brute luck of bad health, etc. could all preclude someone from obtaining basic utilities and access to productive labor – that inequality in net worth, health and other spheres preclude access to the sphere of labor regardless of one’s abilities – is something to be fought tooth-and-nail.
2. There’s a medium-term problem. Hard and soft forms of behavioral surveillance technology are maturing into things legible and deployable for employers and recruiters at exactly the moment when employees have little-to-no aggregate bargaining power. From Elise Gould at EPI, the ratio of job openings for job seekers:
The unemployed (and this graph doesn’t count those who have dropped out of the labor force, or are underemployed) have to be willing to jump through a lot of hoops to secure work, and right now opening up the most revealing parts of their private lives are on the table for what is relevant for an employer to see.
3. There’s a long-term problem. As surveillance technology continues to mature we are seeing a strong internal surveillance state complex that blurs the private and the public sector. As Jack Balkin warns, private firms can often be used to end-run constitutional protections against state searches and this is all part of a larger issue that goes beyond the War on Terror. These problems, of who has access to your information and what they are allowed to do with it, are only going to get bigger as algorithms and technology becomes more sophisticated. Do liberals need a new conception of privacy, one related to the 21st century, to fully combat this, or can we work from where we are now if we had a President interested in appointing judges?